A new report out today shows that companies taking action for gender equality see lower staff turnover, more women in leadership and better shareholder value.
The 10th report in the Gender Equity Insights Series from Bankwest Curtin Economics Centre (BCEC) and the Workplace Gender Equality Agency (WGEA) also warns Australian businesses could fall behind their competitors if they don't take strong action to address gender balance.
The report investigates what drives gender balance. Gender balance means having at least 40 per cent women and 40 per cent men in the workforce.
It reveals that higher resignation rates for women is a key factor shaping whether companies move towards, or away from, a gender-balanced workforce.
As a result, it will be harder for businesses that don't address it, to reach gender balance. But, companies that take proactive action - like setting goals for pay equity, doing a regular gender pay gap analysis, and making leadership roles more flexible - see fewer women leaving and more women moving into management.
The new findings are drawn from WGEA's world-leading dataset of Australian employers, covering more than 5.1 million workers.
BCEC Director and report author, John Curtin Distinguished Professor Alan Duncan, said the research shows that workforce gender equity in Australia is a story of both progress and fragility.
"Gender balance is not just a fairness issue, it's a sound financial strategy," Professor Duncan said.
"Organisations that invest in equity strategies not only close pay gaps, they also build stronger, more resilient workforces. By contrast, those that fail to act will continue to lose talent, eroding leadership pipelines."
The research highlights that gender equity and better company performance go hand-in-hand.
It shows that gender-balanced executive teams deliver higher company value.
For a $1 billion ASX-listed business, this equates to around $93 million on average in added company value and up to $120 million depending on the existing leadership gender balance of the organisation.
It builds on existing evidence that diverse leadership teams foster improved innovation, better decision-making, and have a stronger capacity to navigate economic shocks.
WGEA CEO Mary Wooldridge said every employer could secure benefits from addressing gender equality, starting with a gender pay gap analysis.
"The evidence is clear that gender-balanced leadership teams don't just support women, they also deliver stronger results by fostering better decision-making, innovation and capacity to navigate challenges," Ms Wooldridge said.
"This research points to the benefits that flow to those employers that choose to embed gender equality into their business strategies.
"By digging into the data and developing an approach that's tailored to their specific workforce needs, employers can build a strong pipeline of talented leaders and help safeguard the long-term sustainability of their organisation."
The report also investigates pay gaps within an organisation, between women and men doing jobs at a similar level, but that have different salaries – also known as 'horizontal pay gaps'.
It finds many roles are now within 5 per cent of parity, suggesting that other structural issues – like occupation segregation across roles and industries and sector-wide pay differences - remain more dominant factors driving gender pay gaps.
The report also finds that, although service industries, such as arts and recreation, accommodation and food, and finance are showing positive gains in gender balance, across all industries just 27 per cent of employers have a gender-balanced workforce.
Boards are edging closer to parity, but gender balance in leadership is still rare (only 1 in 4 employers).
The report sets out a clear agenda for employer action including by tracking and addressing resignation patterns, embedding accountability for leadership balance, redesigning pipelines for women into traditionally men-dominated roles and men into women-dominated roles, and normalising flexibility in leadership roles.
"Gender equity and business performance go hand-in-hand," Professor Duncan said.
"Australia cannot afford complacency. Employers who take deliberate action will not only retain women and strengthen leadership pipelines, they will also secure long-term value, innovation and competitiveness."
